On January 12, Fred Trump purchases property to build Beach Haven apartments for Navy personnel in Virginia Beach and was overcompensated with loans from the Federal Housing Administration. Fred Trump and his partner received at least $3.5 million more from the FHA than the cost to build his first two apartment complexes (Shore Haven and Beach Haven).
It was later found out that the FHA gave Fred Trump $10.4 million in funds for Shore Haven, his first FHA-backed apartment complex, but the money was divided amongst three separate land purchases as a loophole. There was a $5 million limit on government project financing.
The FHA was created in 1934 to ensure affordable housing for the growing population but changed course after World War II to enrich already successful builders.
FHA Investigation, page 52
Trump: The Deals and the Downfall by Wayne Barrett (Excerpt)
Photograph: Jack Smith/NY Daily News Archive, via Getty Images